TEXAS SUPREME COURT BRINGS CLARITY - NEW TRIAL MAY BE GRANTED ONLY FOR VALID REASONS EXPLICITLY STATED IN TRIAL COURT’S NEW TRIAL ORDER

Prior to 2009, a trial court’s order granting a new trial was effectively immune from appellate review in Texas.  Since 2009, however, the Texas Supreme Court has sought to clarify the rules under which parties may challenge a new trial order in the courts of appeals, and such orders are now subject to correction by mandamus where they are granted for invalid reasons not supported by the record.  In its latest opinion on the issue, the Texas Supreme Court sided with USAA and reaffirmed that new trial orders may be granted only for valid reasons that are supported by the record and that are explicitly set forth by the trial court in its order granting new trial.  In re Bent, 2016 WL 1267580, No. 14-1006, ____ S.W.3d ___ (Tex. April 1, 2016).

In Bent, following a two week jury trial, the jury reached a verdict that USAA committed no breach of contract in its adjustment of a Hurricane Ike claim and rejected six of seven extra-contractual claims brought by the Bents.  Rather than sign a judgment on the jury’s verdict, however, the trial court entered an order granting the Bents a new trial.  The court offered its reasoning that the evidence was factually insufficient to support the jury’s breach of contract and extra-contractual findings, that USAA violated an in limine order in its closing arguments, that the jury’s damages findings “seem[ed] arbitrary,” and that jury erred in finding the Bents were not entitled to appellate attorneys’ fees.

USAA sought mandamus relief in the court of appeals, asking the court of appeals to direct the trial court to sign a judgment.  The court of appeals agreed that the trial court’s order presented no legally valid basis to grant a new trial and conditionally granted mandamus relief instructing the trial court to enter a judgment.  The Bents subsequently sought mandamus relief in the Texas Supreme Court, arguing that the court of appeals failed to properly apply the Texas Supreme Court’s recent new trial precedents.

Elucidating on Texas law, Texas Supreme Court concluded that the court of appeals properly applied its precedents, holding that the trial court’s order (1) failed to provide reasonably specific explanations tied to the evidence supporting its new trial order and (2) presented reasons that were contradicted by the evidence in the record.  And, the Texas Supreme Court emphasized that, in such situations, a new trial order cannot stand.  To properly grant a new trial, the trial court is required to “indicate that [it] considered the specific facts and circumstances of the case at hand and explain how the evidence (or lack of evidence) undermines the jury’s findings.”  Accordingly, the Texas Supreme Court’s opinion instructs the trial court to vacate its order and enter judgment.

Editor’s Note: USAA was represented by Levon Hovnatanian and Robert Owen in the court of appeals and in the Supreme Court of Texas.  Martin, Disiere, Jefferson, & Wisdom, LLC congratulates and thanks USAA for the opportunity to help clarify Texas law on these important legal issues.